Ghana loses gold production top spot in Africa as output falls

The volume of Gold declined to 2.818 million ounces in 2021 from 4.022 million ounces in 2020, the lowest level of output since 2008.

Mr Joshua Mortoti, the President of the Ghana Chamber of Mines, said the drop in production followed concurrent reductions in the output of large and small-scale Gold producers.

The large-scale sub-sector’s contribution to national gold production fell to 2.720 million ounces in 2021 compared with 2.847 million ounces in 2020.

Mr Mortoti said the decline in the sub-sector’s contribution was due to a broad fall in output in most of the large mines.

Also, production of small-scale producers plummeted by 91.66 percent to 0.098 million ounces in 2021 from 1.175 million ounces in 2020.

“The near collapse in the sub-sector’s output was principally a reflection of the producers’ response to the imposition of a 3 percent withholding tax on their output by the government in 2019,” Mr Mortoti said.

“Although anecdotal evidence suggests that the impost did not culminate in the cessation of operations, it is believed that it induced the small-scale miners and Licensed Gold Exporting Companies (LGECs) to export their output through non-official channels,” he added.

On the other hand, the output of the sole producer of bauxite, Ghana Bauxite Company, dropped from 1.162 million tonnes in 2020 to 0.839 million tonnes in 2021.

The cutback in production was largely an outcome of the uncertainty regarding the renewal of the lease of the operator of that mine, Bosai Minerals Group.

On the upside, the exports of diamonds recorded growth for the first time since 2014. The quantum of diamonds exported through the implementer of the Kimberly Process, PMMC, improved by 114.20 percent.

The increase in exports from 25,292 carats in 2020 to 54,174 carats in 2021 was primarily a consequence of high recoveries by artisanal winners, who have been the sole producers of that mineral since the only large-scale producer (Great Consolidated Diamond Company) was put under “care and maintenance”.

Likewise, the attributable production of manganese by Ghana Manganese Company, which is the sole producer, expanded from 2.357 million tonnes in 2020 to 3.336 million tonnes in 2021.

The 41.52 percent upturn was reflective of a full year’s production.

In the preceding year, the company’s output was adversely impacted by a series of “stop and start” orders by the government.

On the domestic tax contributions of the mining sector, Mr Mortoti said the total direct domestic fiscal contributions of the producing member companies of the Chamber increased from GH¢3.973 billion in 2020 to GH¢4.611 billion in 2021.

The 16.05 percent expansion in fiscal payments was driven primarily by an upturn in all the direct fiscal streams; corporate income tax, mineral royalties, and employee income tax.